AMA Advocacy Update- How SGR Law Changes will Affect Physicians

June 2, 2015
ACP Media Coverage

From the American Medical Association
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Changes physicians should know in the SGR repeal law

When the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) was signed into law in April, it didn’t just repeal the Medicare sustainable growth rate (SGR) formula that had been plaguing physicians for nearly two decades. The bill contained other provisions that will impact how physicians deliver care now and in the future.

Here are several provisions that should be beneficial for physicians:

Medicare payment rates will be stable

MACRA prevented an impending physician payment cut under the SGR and increased the Medicare conversion factor, part of the formula for calculating physician payments. As a result, Medicare physician pay this year will be 27 percent greater than under SGR.

The bill also provides for positive payment updates of 0.5 percent, starting July 1 this year and then on Jan. 1 annually through 2019. Over the next decade, MACRA is projected to increase Medicare funding for physician services by roughly $150 billion.

Quality reporting programs will be consolidated

Medicare’s current quality reporting programs will be simplified into one merit-based incentive payment system, referred to as “MIPS.” This means the current web of penalties under the Physician Quality Reporting System (PQRS), meaningful use electronic health record (EHR) program and the value-based payment modifier will expire at the end of 2018 and will be replaced with the MIPS.

Beginning in 2019, physicians who score well in the MIPS could receive substantial bonuses.

Performance under the MIPS will be based upon four categories—quality, resource use, meaningful use and clinical practice improvement activities. The MIPS also would build and improve upon current quality measures and concepts in existing programs.

Physicians will be encouraged to report quality measures through certified EHR technology or qualified clinical data registries. Participation in a qualified clinical data registry would also count as a clinical practice improvement activity.

Alternative payment models will be rewarded

Physicians who participate in qualified alternative payment models will receive a 5 percent bonus starting in 2019. These physicians also will be exempt from participating in MIPS. Technical support will be provided to help smaller practices participate in alternative payment models.

The AMA is engaging with medical specialty societies and other organizations to help develop and get payers to support implementation of physician-designed alternative payment models. Results from a recent AMA study conducted by the RAND Corporation found that doctors want to improve patient care delivery through new payment models but need help successfully managing the transition. That includes being able to resolve the diverse priorities and quality metrics of different payers and securing more timely and accurate clinical data to ensure long-term success.

Physicians will have liability protections

The bill contains a provision similar to the Standard of Care Protection Act that will protect physicians by preventing quality program standards and measures (such as PQRS or MIPS) from being used as a standard or duty of care in medical liability cases.